Legal Expert Weighs Likelihood That Cardano, Dogecoin, Polkadot and Uniswap Will Face Regulatory Action From the SEC


Legal expert and XRP advocate Jeremy Hogan is sharing his outlook on the likelihood that several large-cap digital assets will face future securities lawsuits from the U.S. Securities and Exchange Commission (SEC).

Hogan analyzes how likely the SEC is to go after Cardano (ADA), Dogecoin (DOGE), Polkadot (DOT), and Uniswap (UNI) based on a “danger rating” of 1-10, with 10 being the most likely.


The lawyer notes that ADA was first released as an initial coin offering, something he claims is “problematic” in relation to potential SEC lawsuits. Hogan notes, however, that Cardano protected itself with a smart legal maneuver.

“The general thought at the SEC is that almost all ICOs are sales of securities. However, Cardano did something that was legally very smart. Its initial coin offering took place in my old stomping grounds of Japan, which, as you may have heard, is very legal friendly to crypto. About 95% of the ICO was to Japanese nationals, and from there sales went into exchanges for sales to Americans.”

Ultimately, Hogan says that there is “some danger” the SEC will go after Cardano, but he limits his danger rating for ADA to “2.5 out of 10.”

“As soon as the SEC sues exchange number one, the other exchanges will also de-list. But it’s never been done before, so the danger is somewhat remote.”

Next up on the lawyer’s list is Dogecoin, which Hogan notes had no ICO or sale, given that 95% of Dogecoin was mined within the first year. He gives the token a 2/10 danger rating.

“I think the SEC would only be made more of a joke if it sued a joke coin. So I see no problems on the horizon here.”

Hogan believes Polkadot faces more risk than the other two digital assets.

“The Web3 Foundation, which designed and set up the Polkadot platform, had a number of ICOs starting in 2017, and has apparently raised $200 million to date. And to make matters worse, the ICOs took place before the Polkadot platform was fully functional. Not good. This is bad because sales of the DOT coin look more like an investment contract where buyers are relying on the efforts of others – the developers – to increase the value of the token.” 

Hogan says it helps that the Web3 Foundation is a nonprofit corporation that is organized in Switzerland, outside the jurisdiction of the SEC. ICO sales were not made available to Chinese and American buyers. Like Cardano, the lawyer notes that the SEC could go after exchanges if they believe that DOT was sold “in the character of a security.” He gives Polkadot a danger rating of 5/10.


Uniswap, Hogan explains, used a different model than Polkadot or Cardano.

“What’s interesting about Uniswap – developed by Uniswap Labs – from a legal standpoint, is that last year, the network began trying to decentralize itself by distributing tokens through an airdrop…

Meanwhile, Uniswap Labs staff and such received about 40% of the UNI supply, which would be released over a period of four years, kind of similar to Ripple’s escrow. It’s an interesting approach to releasing tokens because under current securities laws, there is a relatively strong argument that the airdrop was the transfer of a security. The analysis is somewhat convoluted.”

Hogan notes, however, that Uniswap Labs did not have an ICO and did not profit from the airdrops.

“The nuts and bolts of it is: if the SEC sues Uniswap Labs and wins, what’s the result? There are no profits to disgorge from Uniswap. So what incentive does the SEC have to file the lawsuit? Is it the principle of the matter? I don’t think so.” 

Hogan gives Uniswap a 4/10 on the danger rating.


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